State Universities: Developments

July 25, 2015

Written by: Tricia Covert

Editor, Arizona Journal of Real Estate & Business

Whether you’re a Wildcat, a Sun Devil or support another college, there is no doubt that the development projects happening at our two major state universities are exciting for all of us. Both Arizona State University and the University of Arizona are in the process of major developments that will greatly impact Phoenix metro and Tucson communities; drawing local and national attention.

I had the opportunity to talk with the leaders for both of these efforts who were very gracious to provide us with some general insight on current and future plans. These leaders will also discuss the developments in more detail at our upcoming Commercial Real Estate Seminar on August 28. Project roles and responsibilities are highlighted below:

University of Arizona
Kip Edwards, Vice President of Development and Construction at Banner Health, has the overall responsibility for the development, design, and construction of all Banner facility projects throughout the country. Because of the size and complexity of the Banner–University Medicine Division projects in Phoenix and Tucson, he has been actively involved in the planning for each.

Arizona State Universty
As Assistant Vice President of Real Estate Development for ASU, John Creer will oversee the development of the project. Catellus is the master developer for The District. In collaboration with ASU, Catellus is responsible for the master planning, installing backbone infrastructure, marketing and managing the daily activities of The District. Brian Kearney, Senior Development Manager, will lead Catellus’ local operations.

What is the primary purpose of this development and what is the overall goal?
From a real estate perspective, it’s to develop a world-class, mixed-use urban development that will enhance the Tempe and ASU communities. From a university athletics perspective, it’s to create a reliable revenue stream that will allow for the development and maintenance of world-class NCAA athletic venues for student athletics and the surrounding community.

How do you feel this development is going to impact ASU, students, and alumni?
The development of The District will have a profound impact on the school and alumni – most importantly ASU’s student athletics and the student body. It gives the university the ability to financially see well into the future as it prepares to upgrade and maintain the many athletic and student venues required to run a university of the highest caliber.

It’s been outlined that this project is taking a phased-in development approach. Can you explain what will be phased-in first and why?
The market will dictate where and when development will occur. We will be marketing for those portions of The District where we don’t have to relocate any athletic venues; i.e., NE corner of University and Rural, SW and NE corners of Rio Salado and Rural. We expect to begin marketing activities late this year and could be underway with initial construction in 2016.

How will the phase-in process effect the surrounding area?
It’s anticipated that the development will occur over 20 years. The phasing will be responsive to market demand and university needs. The usual effects to surrounding areas, such as parking and traffic, are addressed in the overall land use plan and will be handled on a project-by-project basis. Fortunately, there is enough land to move things around, such as interim parking facilities, as needed, over the multiple phases of the project.

How do you feel this development will impact the overall commercial climate in Phoenix metro?
Tempe is becoming a major urban center in the Valley. In fact, it is centrally located and accessible by the freeway system and light rail. The development of The District will add a dimension of mixed-use, athletics and events that will make it unique to other urban centers throughout the Valley. We are very excited that the development of The District is finally here.

Can you give me a synopsis of your development efforts?
This is an incredible investment in academic medicine for the University of Arizona, the cities of Tucson, Phoenix metro and the entire state of Arizona. It is our every intention to develop an academic medical system that is top-rated in the country. Our approach is a unique partnership between a university and a healthcare system – with UA Medical Schools in Phoenix and Tucson working corroboratively with the Banner–University Medicine Division to create an exceptional mechanism to educate students and provide the ultimate care for patients.

Can you outline the developments in process and ahead?
The Banner–University Medicine Division includes three hospitals, various clinics and the Banner–University Medical Group with plans for major capital projects listed below:

Banner–University Medical Center Tucson: New Tower
We will build a new hospital facility at the Banner–University Medical Center Tucson campus to replace the older portion of the hospital. This project is an 11-story building with 680,000 square feet. Design is underway and construction will start late this year – with a completion date of 2018. The goal is to produce a state-of-the art facility with specialized services.

Banner–University Medical Center Phoenix: New Emergency Department (ED) and Clinics
We will build a new 227,000 square feet building to house a new Emergency Department, 40 observation beds, and additional operating rooms. The building is also designed for the future addition of a patient room tower. Construction has already commenced and is expected to be complete in 2017.

There are also projects underway to renovate/repurpose 755 E. McDowell (former Cigna Building – see page 16) and 1441 N. 12th Street (current corporate offices which will be moving to Phoenix Plaza on Central in November of this year). Both of these buildings will house academic medicine clinics for a variety of specialty care Institutes.

Tucson North Campus: New Ambulatory Facility
Build a new 150,000 square feet to 200,000 square feet ambulatory facility that will be a center for specialty clinics plus outpatient surgery and radiation oncology. This project is in the planning stages and is expected to start construction late in 2016.

Phoenix Bio Medical Campus (downtown Phoenix): New Clinic and UA Academic/Research Facility
This will be a joint effort between the City, University of Arizona, and Banner Health to create a combination facility for a Banner academic primary care health center plus University research and education space. It is in the early stages of planning.

John, Brian and Kip will be host speakers at our upcoming Commercial Seminar on Friday, August 28.

Tricia Covert is also the Marketing Manager at the Arizona School of Real Estate & Business. Tricia can be reached at tricia@asreb.com or at 480-874-7135.